What won’t be exempt

You can’t get a deeming exemption just because an investment performs poorly. This includes:

shares with negative returns

companies or funds having short term problems

How to apply

You will need to talk to one of our Financial Information Service Officers and complete an application.

Who decides

The Minister for Social Services is the only person who can grant a deeming exemption.

If they grant you a deeming exemption, they’ll decide the start date. In most cases this is:

the date when you applied for the deeming exemption, or

the date when an insolvency practitioner starts

The exemption keeps going until the reason for it no longer exists.

How they decide

The Minister considers a range of factors for each type of investment.

Failed investments

Factors include if:

it would be unfair to apply the deeming rules in this case

the investment is not providing a return

you have access to any of the investment capital

the reason why there are no returns and you can’t get the capital back is:

a legal obstacle from a third party or someone other than the fund manager

conditions that you couldn’t have foreseen and that weren’t in the product disclosure statement or prospectus

If there’s widespread impact from an investment company collapsing, there may be a deeming exemption for all investors. In this case you don’t need to apply for a deeming exemption. Just contact us to check if the group one covers you.

Superannuation

The Minister will consider why you can’t get your money. It could be because of:

the rules of the fund

a court order

the regulations about super

You can’t get an exemption if you have access to any part of your super when you apply.

An exemption will also affect how we value the investment for the assets test.

Church and charitable institution development funds

Until 1 January 2010 many of these funds had a deeming exemption. Normal deeming rules now apply.

Your investment in one of these funds may still be exempt if you:

invested before 2010

were getting an income support payment then, and

have been on the same payment ever since

If you stop getting the payment, the exemption will end for good.

The exemption is only for amounts you invested before 2010. Anything you put into the fund since then isn’t exempt.

Evidence we need from you

If you apply for a deeming exemption you need to give us proof of the reason for it.

Failed loan or investment

We may ask for:

a report from the appointed insolvency practitioner

a letter from your lawyer with details of the legal action you’ve taken to get your money back

court documents

Superannuation

We’ll need:

the latest statement from the super fund. If you’ve had a birthday since then, you need to get a new statement

documents showing the investment’s current value and status - this includes:

the preserved amount

the restricted non-preserved amount

the unrestricted non-preserved amount

If in doubt, check with your fund to see if you have access to any of the investment now. If so, you can’t get an exemption.